Celebrating its 20th anniversary this year, DreamWorks Animation has enjoyed plenty of commercial and critical success, winning two animation Oscars and earning almost $11.6 billion worldwide. And yet, the company remains in the shadow of Pixar, which in about the same amount of time has won seven animation Oscars and had two films nominated for Best Picture, despite making half as many movies as DreamWorks. With the Toy Story trilogy, The Incredibles, And others, Pixar is viewed as the gold standard—delivering not just entertainment, but also art—while DreamWorks (with Shrek, Madagascar, and Kung Fu Panda) is seen as the scrappy kid brother, still trying to get the respect and attention of its older sibling.

Perceptions can change, though. In the last few years, Pixar has produced a series of ho-hum movies, and although DreamWorks hasn't crafted its own Wall-E, they've shown what they're capable of with the How to Train Your Dragon films. Whereas the company once focused on pop-culture riffs disguised as middling kids' entertainment—see Martin Scorsese and Robert De Niro doing their Goodfellas impression in Shark Tale—2010's original Dragon had both grandeur and soulfulness. Based on Cressida Cowell's book, it told the story of a nerdy young Viking named Hiccup (voiced by Jay Baruchel) who befriends a wounded dragon he dubs Toothless. Part E.T. tale, part love-thy-enemy fable, the film had a big heart and some of the most flat-out gorgeous animated sequences of recent times. Paying for 3-D is almost always a ripoff, but Dragon warranted the surcharge: The flying scenes alone were worth it.

Now comes the sequel, and it's nearly as good. Written and directed by Dean DeBlois, who co-wrote and co-directed the first one, How to Train Your Dragon 2 is at its best when it again focuses on the unlikely friendship between this sweet Viking and his lovable dragon buddy. The worst you can say is that it doesn't focus on that friendship enough.

Again based on Cowell's series of books, Dragon 2 finds Hiccup nervously anticipating a future when he will become his tribe's chieftain: a role he doesn't want, in part because he fears he doesn't measure up to his heroic, battle-tested father, Stoick (voiced by Gerard Butler). But when Hiccup discovers that a ferocious warrior named Drago (voiced by Djimon Hounsou) is fast approaching their land, looking to enslave their dragons as part of his plan for world domination, he seeks out this conqueror to explain that dragons aren't fearsome creatures. On his journey, though, he stumbles upon a dragon sanctuary run by Valka (voiced by Cate Blanchett), the mother Hiccup never knew.

The first Dragon was agreeably dark and emotional, tackling the horrors of war and the evils of animal cruelty amid the lighter moments, but the sequel goes even further. Not having children, I'm always bad at advising parents whether a movie will be too intense for their kiddos, but I will say that this new film is commendably grown up in its treatment of death, love, and forgiveness. Though some plot points are telegraphed from miles away, Dragon 2 never cheats to achieve its emotional effects. Like many DreamWorks Animation projects, the whole thing still feels geared more toward young people than their parents—the best Pixar movies seem effortlessly designed to satisfy both audiences—so even if some of the life lessons have a rote simplicity to them, it doesn't diminish the care with which they're doled out.

But as with the original, the visuals are the biggest selling point here. Both films hired longtime Coen brothers cinematographer Roger Deakins as a visual consultant, and while it's hard to know just how much say he has in the final product, their fable-like quality is simply stunning. Mythic when it's not dreamlike, Dragon 2 masterfully weaves together shadows and sunlight, reminding us that what made those picture books of our youth so captivating is that they conjured up an idealized world of magic and possibilities that seemed far more thrilling and freeing than our own. The flying sequences are again superb, but they're complemented by some wonderful set pieces involving Valka's lair and the introduction of Alpha dragons, huge monsters that roam the landscape like Godzilla if he'd been dreamed up by Hayao Miyazaki.

DeBlois' images are often so amazing that I feel ungrateful noting that I wish Dragon 2's story was equally wondrous. Hiccup doesn't just have to contend with Drago: He must do battle with a cocky dragon hunter (voiced by Kit Harington) and continue wooing Astrid (America Ferrera), his smart-aleck love interest from the first film. There's also the fallout from Valka's return to Hiccup's life, not to mention that Hiccup's buddies (who are voiced by, among others, Jonah Hill and Kristen Wiig) need something to do, too. (Unfortunately, that means a lot of needless slapstick and strained "comic relief" moments.)

With so much going on, Hiccup simply doesn't have as much time alone with Toothless, and the movie suffers as a result. If the original was a buddy movie, Dragon 2 is more of an action spectacle that charts the reluctant maturation of its budding hero. That cute little dragon still plays his part in that drama—he's the centerpiece of the film's most anxiety-inducing scene—but he's now merely part of an ensemble that he largely outclasses. (I wasn't rooting for any of Hiccup's dopey Viking pals to get killed, but I wouldn't have minded if they had decided to sit this adventure out, either.) How to Train Your Dragon 2 embodies the promise and limitations of DreamWorks Animation: It's a rousing, gorgeous movie, but it doesn't quite have the depth—or that perfect balance of light and dark, childlike and adult—to soar as high as it could. If Pixar didn't exist, these Dragon films would be revelations. Instead, they're just pretty darn good.

Grade: B.

Grierson & Leitch is a regular column about the movies. Follow us on Twitter, @griersonleitch.